The new Microsoft gaming console Xbox will be
based on x86 architecture. The new Xbox according to Bloomberb will be based on
new AMD Jaguar processor just like upcoming PS4. The switch is a boon for AMD,
which is also providing chips for Sony Corp. (6758)’s coming PlayStation 4, as
it seeks a larger slice of the $67 billion global video-game market to help
lessen its reliance on the shrinking PC industry. Microsoft also stands to
benefit because game developers, who have moved toward making games for PCs and
mobile devices, will find it easier to deliver those titles for the next Xbox.
AMD, based in Sunnyvale, California, rose 13
percent to $2.59 at the close in New York, the most since July 2011. That left
the shares up 7.9 percent this year, reversing what had been a year-to-date
decline. Microsoft slipped 0.4 percent to $28.59 and has climbed 7 percent in
2013.Microsoft, which had considered unveiling the Xbox 360’s successor this
month, will do it later, three people said. The company is considering
revealing plans for the new Xbox at the industry’s E3 expo in June or at a
separate event in May or June, they said. Microsoft plans a May 21 event, The
Verge reported today. The company hasn’t released the next Xbox’s
specifications, including whether it will have an optical drive or details of
online-game features and entertainment services. John Taylor, an AMD spokesman,
declined to comment, as did David Dennis, a Microsoft spokesman.
Microsoft, based in Redmond, Washington,
decided against an April event because it saw little competitive pressure from
Sony, which plans to release the PlayStation 4 in time for the Christmas
holidays, said two people.At Sony’s February unveiling of the PlayStation 4,
the Tokyo-based company demonstrated the controller and game play running on
prototype hardware, without showing the machine. Critics including Amir
Anvarzadeh, a Singapore-based manager for Asia equity sales at BGC Partners
Inc., panned the lack of any “revolutionary” advances and the PS4’s emphasis on
social- gaming features.Nintendo Co. (7974)’s Wii U, another competitor, has
been selling below the company’s initial forecasts since November. In January,
the company said it expected to sell 4 million units in the year ending March
31, down from a previous outlook for 5.5 million.For AMD, providing chips for
game consoles is part of Chief Executive Officer Rory Read’s plan to lessen the
company’s dependence on the declining personal computer market. Read is aiming
to get more than 20 percent of the AMD’s revenue from areas other than PCs by
the fourth quarter.
Traditional console makers face competition
from cheaper machines like Ouya Inc.’s, and changes in game play that favor
inexpensive titles for mobile devices such as Apple Inc. (AAPL) iPads and
Samsung’s Galaxy Tab.U.S. retail sales of packaged video games fell 21 percent
last year to $8.9 billion, according to researcher NPD Group, while revenue
from games downloaded to computers and mobile devices rose 16 percent to $5.9
billion. Globally, the market including hardware and accessories was $67
billion.
The decision to switch to mainstream PC
processors also will make games developed on previous generation consoles
incompatible with the new systems, Envisioneering’s Doherty said. Sony has said
it hopes to deliver some older games over the Web, using its Gaikai cloud
gaming service.
In addition to the main Power PC processor, the
current Xbox 360 contains a graphics chip made by a unit of AMD. The
PlayStation 3 uses a custom Cell processor and graphics chips from Nvidia Corp.
(NVDA).
The x86 technology licensed by Intel Corp.
(INTC) -- the so-called instruction set fundamental to all modern personal
computers -- gives the new Xbox access to existing design elements, making the
machine’s chip system cheaper to develop. The new also chips offer more
computing power than parts Microsoft is currently using. Apple Inc. dropped the
Power PC design from its Mac computers in 2005. In the PlayStation 4, Sony is
adopting an AMD custom system-on-a-chip processor that includes eight 64-bit
Jaguar cores with a Radeon graphics processor from AMD’s ATI unit. The PS4 will
come with a secondary custom chip responsible for downloading and processing
games in the background. At February’s unveiling, Sony lead system architect
Mark Cerny said the PlayStation 4 will be a “supercharged PC architecture” with
advanced memory and other features that will reduce development times by making
some decisions within the hardware. According to Envisioneering’s Doherty, the
switch will help Sony bring down the initial cost to make its machines. For big
developers such as Electronic Arts Inc. (EA) and Activision Blizzard Inc.
(ATVI), the savings will allow them to reduce their reliance on $60 titles as
they compete with smaller publishers making games selling for $20 and less.
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